Multiple Choice
According to the Taylor rule,if output is above its full-employment level and inflation is less than 2%
A) the Fed should raise the Fed funds rate above 4%.
B) the Fed should reduce the Fed funds rate below 4%.
C) the Fed should make the Fed funds rate exactly 4%.
D) what the Fed should do is ambiguous.
Correct Answer:
Verified
Correct Answer:
Verified
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